Xero needs more pals in the UK, but at least its existing customers are sticking around.
👉Background: Xero is the accounting software platform that was founded back in 2006 in New Zealand. Its plan was to take on the big dawgs of the accounting world (think: MYOB and Quicken).
👉 What happened: Xero dominated in New Zealand, Australia and then started to grow globally. But at a recent Xero AGM, its CEO warned that subscriber growth in the UK ain’t exactly on target.
👉 What else: The good news is that the total lifetime value of Xero customers increased 43% year on year. And customers are more sticky than ever.
💡 A customer’s lifetime value is the total revenue earned from a single customer over the lifetime over their relationship with the business.
💡 Depending on the industry, it can cost 5-25 times more to acquire new customers than keep existing ones. So increasing the value of your existing customers is a great way to drive revenue growth.
💡 It also helps businesses like Xero know how much they can spend to actually acquire a new customer. For example, if the customer lifetime value is $100, then you wouldn’t want to spend $110 to acquire them.
Sign up for Flux and join 100,000 members of the Flux family
